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Everything you need to know

Greater Manchester Office

More than 500 laws and regulations!

We can help to ensure that you meet all the necessary legal requirements for letting out your property.

Renting out your property

A landlord needs to know a lot, and if you don’t stay up to date with changes, you could easily find yourself unknowingly breaking the law, which can be very costly both financially and personally.

More than 500 laws and regulations affect the residential lettings industry on daily bases, so choosing an agent who has extensive* understanding of landlord’s legislation is vital.

Legal responsibilities of a landlord include the following:

  1. Blinds & Curtains
A new set of European regulations now apply to the installation, for raising and lowering blinds and the movement of curtains across windows. Therefore, newly installed blinds and curtains by a contractor would feature fixed cords or ball-bearing pulls to prevent any danger of asphyxiation to a young child, as well as a warning notice with the purchasing material. It may be necessary to install safety features on existing blinds and windows to ensure compliance and safety.
 
If you choose our “Full Management” service, we will inspect all blinds and curtains during the management visits. And, if required, arrange for the appropriate safety features to be installed at the landlord’s expense. If the agent is not managing the property, it is your responsibility to carry out such checks and arrange for the fitting of any necessary safety features to comply with lettings legislation.
  1. Central heating, boilers and all gas appliances
Gas Safety Certificate (GSC) must be issued annually for all gas appliances and inspected under the Gas Safety Regulations.
 
(These are normally scheduled by us).
 
According to your own arrangement, your property manager will require a copy of the GSC before a tenancy can begin as well as annually thereafter. In the event that certificates are not provided or they expire, we will not be able to start a tenancy without a valid certificate.
  1. Checkout inspection
The property is thoroughly inspected at the end of each rental period (full management only).
 
Deductions must be agreed between landlord and tenant, and we will do everything to reach an agreement.
 
In case of disagreement, the matter will be referred to the appropriate body for arbitration. Both the landlord and tenant must accept the Independent Case Examiner’s decision (service included with Full Management only).
  1. Deposits & tenancy deposit protection
As per the Tenant Fees Act 2019, the deposit is equal to five weeks’ rent.
 
In most cases, the deposit is intended to cover damage to the property above and beyond normal wear and tear.
 
It is also intended to compensate for rent arrears or breach of contract costs.

Housing Act 2004, prohibits landlords from holding unregistered or unprotected deposits. However, Kovac’s is proud to be a member of a tenancy deposit service scheme and all deposits relating to Assured Shorthold Tenancies will be dealt according to the rules of the Tenancy Deposit Regulations. In this regard, the scheme does not cover deposits related to tenancies which are not Assured Shorthold Tenancies. However, they will be handled according to scheme principles.
  1. Electrical equipment and PAT Testing
Before each tenancy, all portable electrical items should be tested.
 
We can arrange for this work to be performed by an external contractor who is qualified. It will be the landlord’s responsibility to cover the cost.
  1. Electrical safety
To ensure the electrical system is safe, it is necessary to test the safety of the installation before moving into the first tenancy.
 
A safety check of this type should be performed every five years or sooner at the electrician’s recommendation. Although this regulation is only applicable to England by law, we suggest that all safety checks are conducted where possible.

As of 1 June 2020, Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 (The Electrical Safety Standards), became applicable:

For New residential tenancies commencing 1 July 2020, in the private rented sector; and

For Existing tenants of the private rented sector starting on 1 April 2021.

This requires landlords to inspect electrical installations, and to ensure they meet the “BS7671:2018 standards”, at the beginning of their tenancy, as well as every five years.

Within 28 days of the inspection, the tenants must receive a copy of the inspection report, and any remedial work must be completed within 28 days (or sooner, if the report requires it).

This Landlord Guide can be found here LINK, as well as the Electrical Safety Roundtable & NAPIT Q&A here LINK.

If you need assistance with this, Kovac’s office can help. However, due to high demand, we recommend scheduling your safety check sooner rather than later.

EPCs & Minimum Energy Efficiency Standards

The Energy Performance Certificate (EPC) is required whenever a property is built, sold, rented or leased, and it lasts for 10 years.

EPCs rate the energy efficiency of dwellings on a scale from A to G.

Homes in the band A should have the lowest fuel costs. (Environmental impact is measured using the same scale on the certificate).

Better-rated homes should emit less carbon dioxide (CO2).

In Buy-To-Let properties, tenants can apply for permission to undertake energy efficiency improvements, subject to approval, from April 1, 2016.

As of April 2020, any private rented property must have an Energy Performance Certificate (EPC) with an E rating or higher to comply with new lettings legislation.

Regulations apply to all tenancies from 1 April 2020.

Rental properties that do not meet the minimum E rating requirement are considered illegal, unless an exemption applies. A civil penalty will be imposed for landlord legislation violations.

  1. Furniture & Furnishings (Fire & Safety) Regulations 1988
The above regulations apply to any soft furnishings in a rented property.
 
In general, soft furnishings manufactured after March 1990 are compliant with the requirements, although they must be labeled accordingly.
 
Non-labeled furniture is considered non-compliant (except for antique horsehair-filled furniture that has not been reupholstered).
 
However, renting a property with non-compliant furniture is a serious offence, which can result in prosecution of the landlord and the agents.
  1. Homes (Fitness for Human Habitation) Act
In England, the Homes (Fitness for Human Habitation) Act 2018, commonly known as the Homes Act, replaces Section 8 of the Landlord and Tenant Act 1985 (LTA 1985), which focuses on improving living standards in private and social rented housing.

An unfit property for human habitation is one that has so many defects that it is not reasonable for occupation in that condition. This includes: any prescribed hazards, repairs, stability, freedom from damp, internal arrangement, natural lighting, food preparation and cooking facilities, water supply, drainage, sanitary conveniences, ventilation, and waste water disposal facilities.

According to the Homes Act 2018, landlords and letting agents acting on their behalf must ensure properties, including common parts, are fit for human habitation at the beginning and during the duration of a tenancy. As a result of the new legislation, tenants will be able to take direct legal action if their agent or landlord does not comply with the Act. Agents should be aware that local authority enforcement offices won’t need to conduct property checks. The law applies to ALL domestic tenancies in England only. 

Please note: Section 8 of the LTA 1985 is now applicable only to tenancies in Wales. In the new section 9C, there is a substitution of the term ‘house’ for the term ‘dwelling’ for Agricultural Tenancies. This Act does not apply to individuals who have a “Licence to Occupy”. These may include lodgers, residents of temporary accommodation, and some guardians of property, but are not limited to them.

Every individual should ensure that their property or dwelling is suitable for habitation.

  1. Legionella
A residential water system that uses either hot or cold water is potentially a source of legionella bacterial growth.
 
In all cases, landlords and agents who have control over privately rented properties are now responsible for protecting their tenants against Legionnaire’s Disease.
  1. Prescribed Hazards
Under the Housing Act 2004, a ‘hazard’ is defined as ‘any potential risk of harm to the health or safety of an actual occupant of a dwelling or HMO caused by a deficiency in the dwelling or HMO’.
 
There are 29 hazards listed in the Housing Health and Safety Rating System (HHSRS) that are used as the basis for assessing the hazards under the Homes Act.

The 29 HHSRS hazards are:

dampness and mould growth; excess cold; excess heat; asbestos and manufactured mineral fibres; biocides; fuel combustion products and carbon monoxide; lead; radiation; uncombusted fuel gas; volatile organic compounds; crowding and space; entry by intruders; lighting; noise; domestic hygiene, pests and refuse; food safety; sanitation and drainage problems; water supply; falls associated with baths; falls on level surfaces; falls associated with stairs and ramps; falls between levels; electrical hazards; fire; flames, hot surfaces and materials; collision and entrapment; explosions; ergonomics; and structural collapse and falling elements.

  1. Property Licensing
In accordance with the Housing Act 2004, local authorities are able to regulate standards in the private rented sector by introducing property licensing schemes.

The purpose of licensing schemes is to address issues within the private rented sector and to mandate minimum standards for certain types of rental housing.

UK licensing schemes are currently divided into three types:

  • Mandatory licensing is required for large HMOs (Houses in Multiple Occupations) across the country.
  • Additional licensing schemes can be introduced by local councils at their own discretion. “The regulations are typically applied to HMOs with three or four occupants and are typically applied across an entire local authority or a particular area”.
  • Selective licensing schemes It is also possible for councils to implement selective licensing schemes at their own discretion. Regardless of the tenancy breakdown, selective licensing applies to all private rented properties.

Our team at Kovac’s understands that licensing can be a challenging process and that landlord legislation can often be difficult to comprehend. For this reason, we offer landlords our services to help ensure the correct license is obtained and that both landlords and tenants are protected.

Unlicensed properties can result in harsh penalties. Councils can impose civil penalties of up to £30k per breach, and tenants can seek restitution for up to 12 months.

  1. Tenancy Deposits: Tenancies from 1 June 2019
As of 1 June 2019, a refundable tenancy deposit cannot exceed five week’s rent for rents under £50,000, and six weeks’ rent for rents over £50,000.
 
In cases of damage, unpaid rent or bills at the end of the tenancy (England only), you can ask the tenant to pay a tenancy deposit as security for performance of any obligations or discharge of any liability arising under or in connection with the tenancy.

If the annual rent is less than £50,000, you cannot ask for a deposit greater than five weeks’ rent. For tenancies with an annual rent of £50,000 or more, the tenancy deposit is capped at six weeks’ rent.

Payments over this amount are prohibited. However, landlords are not legally required to take a deposit.

  1. Right to Rent
(Immigration Act 2014)
 
All private landlords (including their agents) in England must ensure that new tenants are legally entitled to live in the UK before renting out their property as of 1 February 2016.
 
Upon successful completion of a Right to Rent check, an agent may proceed with the usual full referencing procedure, but if the Right to Rent check fails, we will not be able to commence a tenancy.
 
The agent cannot agree to a let unless the applicant(s) has submitted the necessary documentation. Landlords and letting agents are required to conduct follow up checks on tenants with time-limited rights to remain in the UK; normally 12 months after the initial check or at the end of the individual’s right to remain (whichever is later).

Immigration Act 2014 introduced the Right to Rent as a measure to build a fairer and more effective immigration system.

  1. Smoke & Carbon Monoxide Alarm (Amendment) Regulations 2022
In accordance with the regulations, starting on 1 October 2022.
 
All rental properties must have at least one smoke alarm in each storey of the property and a carbon monoxide detector in each room where a fixed combustion appliance is used to heat the premises, but excluding rooms with only gas cookers.
 
The landlord must keep a clear record indicating that the alarms and detectors were tested prior to the commencement of a new tenancy after October 1, 2022.
  1. Tenant Fees Act (2019)
The ban on tenant fees applies to new or renewed tenancy agreements signed on or after 1 June 2019.
 
The government’s Tenant Fees Act 2019: guidance LINK helps explain how this legislation affects tenants, landlords and letting agents.
 
You might also find the How to rent guide LINK and How to let guide LINK useful.

From 1 June 2019, the only payments that landlords or letting agents can charge to tenants in relation to new contracts are:

  • Rent
  • A refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above.
  • A refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent.
  • Payments associated with early termination of the tenancy, when requested by the tenant.
  • Payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy.
  • Payments in respect of utilities, communication services, TV licence and Council Tax.
  • A default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement.

The aim of the Act is to reduce the costs that tenants can face at the outset, and throughout, a tenancy. Tenants will be able to see, at a glance, what a given property will cost them in the advertised rent with no hidden costs.

  1. The Debt Respite Scheme (Breathing Space Moratorium & Mental Health Crisis Moratorium (England & Wales) Regulation 2020

People in England and Wales with unsustainable debts can enter a ‘breathing space’ under the Debt Respite Scheme (Breathing Space) starting on 4 May 2021.

As soon as someone enters a breathing space, their creditors (i.e., landlords and letting agents) are prohibited from contacting them directly to request payment of the debt, charging interest, fees, or penalties, or taking enforcement action to recover the debt (including taking possession of the property) while the breathing space is in effect. The purpose of this scheme is to provide people who are in debt with enough time to find a financial solution.

Official government guidance can be found HERE on the government’s website.

  1. The Fifth Money Laundering Directive (5MLD)
The 5MLD came into effect in the UK on 10 January 2020.
 
5MLD amends the previous UK regulation to make letting agents subject to the Money Laundering Regulations.
 
Therefore, letting agents must evaluate specific tenancy agreements for their potential to be used as a method to obtain proceeds of crime. This regulation applies to all tenancy agreements with a rent in excess of £10,000 per calendar month. As a result, letting agents are required to conduct ‘Know Your Customer’ checks on tenants and landlords.
 
In order to comply with ‘Know Your Customer’, identification documents must be checked and residency status must be confirmed, along with a verification that the tenancy is legitimate and is not being used to launder proceeds of crime by the tenant or landlord.
 
In the case of tenancies that fall under the scope of the regulations, ongoing monitoring will be required to ensure that the initial conclusions regarding the money-laundering risk assessment remain unchanged over the whole period of the business relationship.
 
Therefore, landlords and tenants with this type of tenancy must be prepared for additional questions and administration requirements.
 
Visit the government’s website LINK for more information about the Fifth Money Laundering Directive.
  1. Central heating, boilers and all gas appliances
Gas Safety Certificate (GSC) must be issued annually for all gas appliances and inspected under the Gas Safety Regulations.
 
(These are normally scheduled by us).
 
According to your own arrangement, your property manager will require a copy of the GSC before a tenancy can begin as well as annually thereafter. In the event that certificates are not provided or they expire, we will not be able to start a tenancy without a valid certificate.
Please note: the information presented on Kovac’s blog is intended to provide general information only and represents understanding at the time of publication. It is not intended to serve as legal advice and should not be treated as such. Therefore, this information is provided without any warranties, express or implied. Access the latest version here.

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